The global economy is being impacted by a number of events, curtailing the ability to conduct business as usual. Should you find your business facing immediate business cash flow issues resulting from an external economic shock, following a clear concise plan can help you manage your way through the crisis.
There are three fundamental steps (Assess, Engage, Act – AEA) to follow in navigating a cash flow issue and safeguarding the future of your business, regardless of the industry.
Kieran Wallace, Andrew O'Leary and Teresa King of our Working Capital Management team explain how to apply this framework to your business.
Gaining visibility and control over cash flows and working capital is fundamental during a time of crisis.
Making cash management a boardroom priority and engaging with stakeholders early will help you to understand your current situation and reduce any ambiguity between parties.
Delivering upon what you have agreed with Stakeholders will help to alleviate pressure and give you time manage the situation.
Regular variance analysis of actual versus forecasted cashflows should be carried out with variances robustly challenged.
Using data and analytics, cash management inefficiencies can be quickly identified. An improvement plan for the business should be developed and implemented to achieve sustainable improvements in cash balances and working capital performance.